“My View” from the May 14, 2012 edition of “Viewpoint with Eliot Spitzer.”
What to do with Jamie Dimon? The CEO and Chair of JPMorgan Chase has tried so hard to seem the “good banker” — so charming, so gracious. Yet all the while, he’s been lobbying, cajoling, pushing and wheedling to eviscerate any semblance of real reform on Wall Street. He shrugged off the cataclysm of 2008 as just something that happened, like the weather — no reason for structural reform.
Well, now we have reasons — at least 2 billion of them — and it’s clear that Chase has had the sort of distorted incentives that have ruined other big companies.
In addition to all that, Dimon sits on the board of the New York Federal Reserve Bank — the very organization that’s supposed to oversee his bank; the organization that regulates what his bank does; the group that he thinks should relax the rules for his kind of gambling.
So here’s a modest solution: Dimon should resign from the New York Fed board immediately, acknowledging that he can’t be on the board while also lobbying it, and that he doesn’t control risk in his own organization so well.
This conflict of interest is so obvious that it defies all rationalization or explanation. For a decade, the New York Fed has failed to pick up on significant Wall Street threats — excess leverage, subprime fraud and dangerous concentrations of risk in companies that are “too big to fail.”
Maybe that’s because the board contains the very voices that helped cause the failure.
Occupy Wall Street could even focus on this, a tangible objective that captures so many of the structural flaws in our banking system. It’s bad enough that bankers themselves controled the New York Fed’s board for so long. What’s more appalling is that they still do.
As Elizabeth Warren and I are demanding — along with many others — Dimon should resign. Right now.
That’s “My View.”